UPDATE 2-Canada's Telus adds wireless customers; revenue up 5.1 pct

TORONTO, Aug 7 (Reuters) - Telus Corp, one of Canada’s three big telecoms providers, reported a 5.1 percent rise in quarterly revenue on Friday, while gaining wireless, Internet and television customers during a tumultuous period for the industry.

Telus said that in the second quarter it added 76,000 contract wireless customers, who typically spend much more per month for wireless service than those who prepay.

BCE Inc’s Bell service, which shares a national wireless network with Telus, added more than 61,000 such customers in the quarter, while market leader Rogers Communications Inc added 24,000 after two quarters of net defections.

Telus improved on its industry-leading sub 1 percent postpaid churn rate, the portion of those valuable customers who drop the service each month. Its monthly rate dropped 4 basis points to 0.86 percent year-over-year.

The lower churn rate was achieved during a period of competitive upheaval for the industry caused by rule changes that meant more wireless contracts than usual were up for renewal.

Desjardins analyst Maher Yaghi said the results “underscore the company’s strength in attracting and retaining profitable clients to its networks”.

Quarterly net income, however, fell to C$341 million ($260 million), or 56 Canadian cents per share, from C$381 million, or 62 Canadian cents, a year earlier, hurt by the cost of closing a retail photography chain and higher taxes in Alberta.

Excluding one-time items, Telus reported earnings of 66 Canadian cents a share, in line with analysts’ consensus expectations.

The Vancouver-based company said it added 22,000 Internet connections and 17,000 TV customers.

The TV growth was less than Bell reported in the quarter but it compared with losses at cable companies Rogers and Shaw Communications Inc, a Western Canadian rival.

The company said it expects to spend more than initially forecast to build out its high-speed Internet network this year.

Telus said wireless network revenue rose 6.1 percent to C$1.57 billion, on the back of rising use of data and higher prices.

Its fixed-line revenue rose 2.4 percent to C$1.38 billion, with growth in Internet and TV offsetting a decline in legacy voice services.

Telus shares slipped 0.6 percent, in line with the overall fall on the Toronto Stock Exchange’s main index, to C$44.55.

$1=$1.31 Canadian
With additional reporting by Sneha Banerjee in Bengaluru;
Editing by Don Sebastian and Peter Galloway